Profit sharing 401(k) Plan: owner has retired but left his balance in the Plan. He is taking the required minimum distributions. Is he required to take his entire balance out of the Plan because he is no longer working or can he leave it in and continue to take minimums? Someone in our office thought that he has to take the balance out because he is over the NRA of 65.

I thought perhaps that only applies to Defined benefit plans?

I divorced in April of 2010. My attorney quit on me after 8 months and $3000 dollars compensation. During this time he moved couches and tables from from one side of the property division paperwork to the other. I ended up drafting my child custody and vistation order. I told my ex from the start that we needed to work together to divide the property, that the attorneys were only taking ouyr money. After the 8 months my ex's attorney told her that she and I needed to come up with a property division. We did just that! We then sent it to my ex's attorney who wasn't happy with it, but, said that if the ex was happy with it she was Ok also. She then submitted it to my attorney who called me and, to make a long story short, quit because he said that "I was getting a much better deal than I would have had we gone to court"! He ended up sending me a letter withdrawing as my counsel and I had to sign off to be able to proceed. My ex's attorney drafted the divorce documents.

I am a member of SERS in PA and in the divorce decree I agreed to 50% of the marital portion of my retirement which was supposed to be for the 22yrs. we were married. I worked for 7 yrs. prior to being married and plan to work another 6 after the divorce. The last 3 yrs. is when amy retirement would significantly increase I contacted my retirement board at the time of the divorce and got an estimate of $900 per month for the ex at the time of my retirement. Now I come to find that the way the ex's attorney wrote up the QDRO, the ex is still increasinbg her share of MY pension clear up untill I retire. I don't believe that's what I signed in the QDRO. I believe she changed the wording after I signed. Any HELP out there?

A 5500-SF was filed timely on October 12th, 2012 with approved 5558 extension for a calendar year plan.

It has now come to light that the Participant contribution amount and subsequently the EOY asset information is overstated by approx. $22,000. (assumption was made that the owner made the max 401(k) when in fact, did not make any contribs).

I can't seem to find info in the 5500 instructions on the EBSA site but recall in the "old" days that an amended return still had to be filed by the original due date plus extension (i.e. October 15th). Since that date has passed do we wait and correct when the 2012 SF is filed or is it necessary to file an amended 2011 SF now? If we do file an amended now would there be penalties involved?

I should know this and shame on me for not but I haven't had to amend a return after the final filing deadline in many years (if I have ever had to do so!).

Thanks in advance.

I am in a position to make a charitable donation. The charity has spoken to me about my IRA (self-directed) loaning the charity money who, in turn, will purchase a life insurance policy on my life with some or all of the death benefit proceeds going to the charity.

IF this is legal, it makes sense to me in my situation. Some of my questions are:

1) Does the charity have to pay my plan on-going interest?

2) Can the charity provide a balloon interest payment upon receipt of death benefits?

3) Can my IRA receive a portion of the death benefit (e.g., 2 million dollar death benefit....can my IRA upon my death receive, as an example, $700,000 with the remaining $1.3 million going to the charity?

4) Is this legal? It appears that it is, but my CPA is not familiar with this type of arrangement.

Ideally, I would like to do this AND have an agreement in place that my IRA would receive the initial premium (to fund the policy that is being loaned) back and a certain amount of the death benefit as an investment return. But can the charity do this OR do they HAVE to pay me interest during the period of time the loan is in force?

I am sure that I am missing a bunch of questions, but some general guidance is appreciated. If legal, this is something that I would seriously like to consider as it still provides a benefit back to my heirs but provides a real benefit back to the charity.

Thank you all so much. Also, I am assuming that if this CAN be done from an IRA, it could also be done from a 401K (I am self-employed)?

John

Has anyone heard of an extension being granted beyond the 2 1/2 months for January 31, 2012 Plan Year ends.

Any help is greatly appreciated.

Thank you.

DPSRich

A 401(k) plan with 20 participants terminates 7/7/2012 because the plan sponsor is being bought by another company.

The buyout deal falls through 11/2/2012.

The only action that has taken place is that a resolution and amendment have been executed to terminate the plan.

Could they just adopt a new resolution and amendment to activate the plan or must they go through with the plan termination then adopt a new plan a year from now?

Thanks.

Can anyone shed light on whether it is permissible under the McNamara-O'Hara Service Contract Act for an employer (the contractor) to discharge his fringe benefit payment obligation through making unvested matching contributions to his 401(k) plan, or whether the fact that the matching contributions are not immediately vested is something that the DOL will not approve. The 401(k) plan has 3-year cliff vesting for the match which satisfies ERISA, I'm just not sure about whether it meets SCA requirements.

The DOL WHD Field Operations Handbook dated 10/25/2010 on the WHD website appears to indicate that as long as the 401(k) plan complies with ERISA vesting requirements, contributions made to it will satisfy the SCA fringe benefit obligation, but other posts I have read here made me question whether that is accurate.

I've had a participant death over the weekend where the participant was age 65 and his surviving spouse is age 76. Normally she would have the 5 year window in which to decide how to handle the distribution, but I'm wondering if an immediate RMD to her must be processed before I do anything else. And

if she doesn't request his vested account balance immediately would I continue to process them annually until distribution has been completed?

Hello,

I'm having a hard time verifying my thinking on this subject. I found a good link one time but I'm having a problem finding it again. Maybe someone can point me in the right direction.

It is my belief the make up payments for a retroactive annuity start date are not rollover eligible. The plan I'm working on does not pay lump sums and gives an interest adjustement for the make up payments per RASD rules. I don't believe the make up payments should be allow to be rolled over.

The trustee/administrator is pointing to 1.402© as justification for the amount being roll over eligible but when I read it I just see it as it falls under the special exemption from not violating the equal payment rule.

Basically employees are going missing/not electing at NRA and then being able to elect rollovers which I just don't see as being permissable.

Any help is appreciated.

Client has come to us. The client had a SEP and then dropped the SEP and added a Profit Sharing Plan.

Has not filed any Form 5500s. They did not know they had to (their words). This I can fix using DFVC Program.

There are also a number of missed RMD payments. How can this be corrected without penalty to affected participant?

A 403(b) plan is changing from one approved vendor to another. Does the plan administrator have an obligation to notify terminated participants who have accounts or annuities at the old vendor that the plan's approved vendor is changing? The terminated participants are no longer receiving contributions on their behalf. On one hand, the individuals at issue are participants in the plan and likely have the same right to receive notifications regarding the plan as active participants. In addition, if the plan allows for contract exchanges, it seems the terminated participants would have a right to know about the switch so they can decide whether to transfer their contract to the new vendor. However, if the plan does not allow for contract exchanges and the terminated participants do not contribute to the plan, it seems the change does not affect the terminated participants and perhaps notice is not necessary.

Just completing my personal first gov't plan year-end. I know there's no 5500 required, but what about an SAR? Since that's a summary of the information on the 5500, my gut says to not prepare one, but the overly-sensitive-to-ten-million-disclosure-notices side of me shudders at the thought that these participants aren't getting anything that summarizes the plan in whole (and worse, it's a pooled profit sharing plan). Who is right - my gut or my paranoia? Thanks.

This post relates to counting hours of service.

DOL Reg 2530.200b-3©(2) provides that: "A plan may use different methods of crediting service, including equivalencies permitted under paragraphs (d), (e) and (f) of this section and the method of crediting service under the general rule set forth in §2530.200b-2(a), for different classifications of employees covered under the plan or for different purposes, provided that such classifications are reasonable and are consistently applied."

I've seen this typically applied by plans that use actual hours for hourly employees and an equivalency for exempt employees. I have not seen this applied to use multiple equivalencies for different groups of employees.

Example: A plan applies the following:

Hourly employees - actual hours

Exempt employees paid on semi-monthly basis - 95 hours per pay period equivalency

Exempt employees paid on monthly basis - 190 hours per month equivalency

Does anyone have any experience with this or comments?

Thanks

Here is my scenario:

Company A contracts with Company B as their EGTRRA document provider. Company A provides a partially completed Adoption Agreement to Client X. Client X completes the Adoption Agreement, signs it and returns it to Company A. Company A confirms that they did receive a signed copy of the Adoption Agreement.

Here is the kicker: In the instruction letter to Client X, Company A tells the client to send the signed Adoption Agreement directly to Company B who will then generate the SPD. Well, it appears that Company B never received a copy of the signed Adoption Agreement so no SPD is generated.

Client has come to us for assistance. Does the client have a valid EGTRRA document or not?

I am still trying to find out who Client X paid to provide the document? The client is a bit 'green' and any time I ask a question, they get very nervous.....

Any suggestions? Thanks.

Hello everyone!

I managed to save the $5,000. for my 2013 roth contribution a little early this year, and will be able to deposit the whole sum in January of 2013. Are there any disadvantages to doing it this way? Should I spread the $5,000. over the entire month of January with seperate transactions on different days, or is it better to do it in one lump sum? Does it make a difference either way? In the past I have always made my contributions on a monthly basis, as I never had the entire amount at one time. It is a target retirement fund if that makes a difference. Any feedback would be greatly appreciated. Thanks, Gracey

If there is a loss, how is this taxced? Do they get a loss to offset their regular ordinary taxable income (i.e., the direct opposite effect of positive income on their taxes?) Any web-sites that discuss would be very much appreciated.

Single Employer has two 401(k) plans (for good reasons). Wants to set up a master trust (for a good reason), and understands potential recordkeeping complications. From a qualification perspective, does each plan need to have its own trust that then "funnels" everything into a master trust (so that there are three trusts), or can there simply be a single trust for both plans?

Brain weary after a week at ASPPA and now trying to find the bottom of my desk, so please forgive the easy question, but I don't see these too often:

Company A has a 401(k) plan and Company B has a 401(k) plan. They are unrelated companies. They form a new Company C and want to establish a new plan and merge the other two plans into the new C plan. A was a safe harbor (k) plan and B was a (k) plan with a match. When we create the C plan (which will be a safe harbor (k) plan), do I need to include matching provisions in the C plan (although they won't be used) to "house" the matching contribution money that will come into the plan via the merger??? [Expanding on the question --- with the merger, it is my understanding that all monies transferred in to plan C retain their money source (401(k), match, SHNEC, rollover, etc.]

Thanks.

We are a TPA firm and over the last couple of days we have received over 15 IRS Proposed Penalty Notices on 5500 filings from different clients. All CP 213N notices and the date of the notice is 10/29/2012. All clients have filed an extension and all clients had filed timely (before 10/15) - no problems there. We know from previous IRS "notice glitch" experience that a faxed response is necessary to stop the notices, but I was curious if others have had a similar experience. If so, any insight on if the IRS has fixed the issue or will our staff have unnecessary task responses for the next week or so?

Wonder how many more of these we will receive..........

A friend of mine works for a small doctor's office and has been employed there for 4 years. In lieu of health insurance coverage under their plan, employees may take a stipend. My friend became aware of the stipend recently when the office manager informed her of it after auditing the office's books. My friend never elected health insurance, never paid a premium, but does not recal ever formally decling it via written notice. Of course, she has never received the stipend, either. The office manager cannot find her election form declining coverage.

Question: Should she be entitled to back payment of the stipend?